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tv   Bloomberg Markets European Close  Bloomberg  July 13, 2017 11:00am-12:00pm EDT

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there is a lack of available forntory particularly people seeking to become first-time homebuyers and the rental rates are extremely low. still have nevada we the worst rates of homeowners being underwater on their mortgages a decade after the recession. rentalas has the worst affordability crisis for lower income households of any major city in the country. can you discuss the role that housing affordability plays in the overall health of the u.s. economy and can we count on homeownership to be the primary source of wealth building for our younger generations like it used to be at one point? housing plays an important role in the economy. housing construction, residential construction is not an enormous sector.
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housing is very important influence on economic performance and on the health of consumers for such a large share of americans. importantir most asset and housing crisis affect well-being, their wealth and availability of credit and access to ability to borrow. so the health of the housing market is extremely important and let me say -- talk about when it comes to the younger generation because the younger generation that i talked to group through the housing crisis. at one point in time owning a home was the best investment you could make. do you think that is something that is going to be of concern for our future and for the younger generation when it comes to owning a home? >> there has always been at the debate over
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whether it is correct that housing is the best investment that one can possibly make and i agree with you that in the aftermath of the crisis views on that are changing. on aot going to opine personal view as to whether or not that's true. but those individuals with very strong credit it's extremely difficult now to gain credit and wegage do have overall i would say a whether it'sousing owner occupied housing or rental housing relative to what you would think would be a normal pace of household formation in this country inventories are low.
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we have seen a significant pickup in rental production of rental housing. you.ank let me jump back to another issue that i hear from my constituents. the fomc has raised interest rates four times since 2015. is generally helps banks revenue since they can charge more to lend money. constituents is they don't see any benefit or interest rate increase that helps them and they want to save their money. wendy went to dissipate the impact of the fed rate hikes will be felt by savers in this country? lag.fortunately there is a lag. we are beginning to see for those who hold large cds for example that it's possible to obtain somewhat higher rates. especially with rates having thinko low for so long i
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it will take some time before competition among banking organizations begins to drive up the rates that smaller retail depositors see. that will occur but it will take a while to show up. >> thank you so much. >> thank you for being here. some of the moves you are making and contemplating at the fed. i know there has been a lot of discussion about productivity and that has been going on for some time. for many many years the only game in town as it related to dealing with the economy was the federal reserve. congress was in a place where likely no actions were going to be taken and so everybody really with the predecessor and much of your term has relied upon the fed to be doing things to hopefully stimulate the economy
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and move things ahead. which is too much of a burden for the fed. a place where in maybe it's not for sure. maybe we will be dealing some things as congress to deal with fiscal issues. other issues that relate to the economy. those could be tax reform itself. withve been in a situation low inflation. really below where you would like for it to be. low productivity. below where you would like for it to be. to leade not questions in a particular direction. his tax reform one of those things that should congress pursue it in a productive manner could be really help full as collateral to move the economy ahead in a much more rapid way?
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>> i would certainly agree that appropriately designed tax reform could have a favorable effect on productivity. it obviously depends on the details of what you do and i don't have numbers to give you there arenly distortions in the tax code that i believe are negatively ipacting productivity and so think there is scope to have a favorable impact on long-term economic growth. >> one of the things we are going to be debating on both sides of the aisle, we've got huge fiscal issues as a nation. obviously constraining spending is one of the ways we all i'm sure in appropriate manners want to look at to keep our deficits down. really the easiest way to move away from the issues that we have.
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mr. mullaney was in my office this week. tax reform is beginning to be something of discussion. i know the current administration wants to see growth into the 3% range to moves beyond where we have been and his tax reform from your perspective something that if done properly has the ability to move us into a much higher growth rate here in the united states? >> as i said i think it is something that could have a favorable impact if appropriately done. growth is very hard to move. if you put in place a policy that predictably raises productivity growth you would probably regard that as a very good payoff. the numbers typically the
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studies show when you do have a positive impact on product tiffany they are not a percent, they are not a percent and a half. it's hard to raise productivity growth. given thechallenging productivityrs growth has averaged a half percent. the last decade something like 1.1%. overall growth for the economy is productivity growth plus growth of the labor force. labor force growth is declining. it's quite low. it it is challenging to move productivity growth up that much. i hope that congress and the administration will focus on changes that will succeed in accomplishing that. >> how much would productivity growth need to be to achieve a
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stable economic growth of 3%? >> i don't have the precise number. it would probably have to rise to something over two. >> productivity over two to get economic growth to three. are not leading questions. do you think it's achievable for us based on all of the things that you see right now to even achieve a 3% growth in the next five year period? something thats is challenging. >> you think that would be very difficult. >> i think that would be quite challenging. thank you. senator corker gave you welcome. gave you a five year window.
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how likely is it that we will see a 3% growth in the next two years? would a veryat difficult. there are strategies we should all pursue because it's got to be one of the goals in fiscal and monetary policy to look at what we can do to get out of the flat growth rate of 2% and i think there's a lot of people saying we are in a perpetual 2% growth. i think it's critically important that we examine strategies together. very real strategies. productivity so you can mask a political agenda. growth innt of export
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the last two years do you think has been related to commodities >> i don't have that number in front of me. you are going to find is when you look at export growth one of the great stories has been an increase in exports of oil and increase in exports of energy and certainly agricultural exports are always a great story when we are talking about balance and trade. right now commodities are getting particularly hard-hit. north dakota is a commodity dependent state in a lot of ways. the dollar values being high never help us in my opinion. badre challenged with weather. we are also challenged with a lot of uncertainty in the trade sector. havee going to continue to
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the trade regime that we currently have in nafta. are we going to be able to do things within a bilateral context in the asia-pacific rim. these are all great challenges. how do you see the trade having an impact on agricultural exports and commodity prices? don't want to wade in in detail into trade policy which is the responsibility of congress and the administration. >> you would agree it is part of our opportunity for economic growth, part of the critical component to our economic growth. >> it certainly has been. >> i think we all understand the
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benefit of low commodity prices toterms of ringing done cost production for companies and its increase in disposable income for consumers. we haven't seen the type of boost andthe economic gdp taking a look at what has happened with gasoline prices and natural gas prices as either an input in the chemical or a major component of manufacturing costs. how are you waiting this tension as you consider further reduction in the fed balance sheet along with possible hikes to interest rates? are considering the overall economic outlook relative to our objectives of maximum employment and price stability and commodity price is certainlyoil prices feed into our view of the outlook. for example the huge decline we
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saw in oil prices is certainly something that substantially depressed investment spending in the united states although it was a plus for consumers. we are now seeing a pickup in drilling activity which is supporting spending on plant and equipment. we need to look at all sectors of the economy and i would summarize that by saying there are trends in different sectors, this year we have had 180,000 jobs a month. last year slightly more. about 190,000. this is been going on for a long time. we can't really control the distribution of jobs across sectors that are created. it has been driving a stronger and stronger labor market with unemployment rates that are now close to historically low
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levels. >> i would suggest the reduction commodity prices, the challenges of the commodity you look at job growth in those very difficult times after 2008 a large percentage of that job growth was equated to energy job growth. so it's critically important that we not look at one side of the equation. that's the point i want to make. priceslysis on commodity in the context of the greater national economy and productivity and any statement you could make on trade follow up with questions. inc. you so much. -- thank you so much. >> thank you mr. chair. to thank senator cortez
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for bringing up the concern of affordable housing. i share virtually all of the sentiment i have heard in every committee. wasn't planning on it but senator corker brought up something i am very interested in because we have to increase productivity. in north carolina when we were in a financial crisis we figured out a way to do that which had to do with tax code and regulations. i want to go back to regulations first. when iy since dodd-frank met with chair greenspan a year and a half ago she mentioned up 350,000 jobs some have been created that are called regulatory compliance and in your judgment is that a job that improves productivity? we have put in place
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regulations to serve important -- >> i understand that. in your professional judgment does a job that relates to regulatory compliance contribute to productivity? >> it is the cost of doing business. reasons that for produce presumably benefits. there are various ways we're going to stimulate growth. by improvingill be productivity. the things you can do by maybe clearing up or eliminating some of the distortions in the tax code. we also have to be mindful to the extent the regulatory burden exceeds what we think is minimally necessary to ensure compliance with areas that represent risk, that is potential capital that could be
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deployed to productivity rather than to overly burdensome regulations. think all regulators should be attentive to the burdens. >> you have been very generous with your time. thank you for taking the time to meet with my office and responding to questions. i appreciate it. i have enjoyed the discussions very much. tax reform is something we spend a lot of time on. we sought to relieve regulatory burdens first to produce economic activity that would ultimately fund real tax reform. to move to tax reform i hope fairly soon. you mentioned there are certain distortions in the tax code if they were dealt with properly would probably have a positive impact on productivity or economic activity.
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to do our job you by creating an agenda for tax reform. could you give me some insights into the areas that you think are probably worthy of the most scrutiny as we go forward with tax reform? >> this is an area i really want to be careful not to wade into and give you any type of detailed advice. i would say there is general agreement that there are distortions in the corporate tax code and opportunities for improvement. thatis is something senator brown's touched on and probably other members did before i came here. i had two competing committees. if you imagine all of the tools that you currently enjoy post dodd-frank -- stress tests, living wills for the largest banks. if they had been in place before the crisis do you think the
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crisis we have experienced would substantially -- the scale of the crisis would have been substantially reduced? >> substantially that's a diffit to render. think we have much stronger capital, much stronger liquidity. i think it important to recognize prior to the crisis we had many significant large standalone investment banks that were very highly leveraged. i try to develop a reputation for being close on time. i got a great response in the meeting so i won't ask you to repeat it. what i would like to see our right sized applications of these regulations. i would like to see rational for how they are applied
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to institutions not based on some arbitrary number. it seems to me that that should only be a data point and the nature of the business and the risk they represent should be the driving factor in going rightsizing these regulations some of which are absolutely essential. do agree with that. in response to an earlier question one way that congress could approach this is to increase these dollar cutoffs. the alternative is to look at individual organizations and the factors that determine their riskiness. we will dohe things is probably maybe put more meaning to that. pointlly need to get to a to where you regulate based on the risk of the specifics of a targeted business instead of us
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fromy we raise the number 50 billion to whatever and index in overtime to pretend we are done. i think we are missing the opportunity to make sure resources are focused on the areas that represent the most risk and away from the businesses that don't. >> thank you, senator kennedy. >> thank you for your service. i think i read the last couple of days that first-quarter growth had been readjusted to 1.4%. if you had unfettered discretion what would you do to improve on that? >> growth is variable from quarter to quarter. we expect significantly stronger growth in the second quarter. would certainly in looking at the performance of the economy smooth through the volatility. doing that we have an economy
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that has grown over the last number of years by about 2% per sufficient has been to create a very large number of jobs and the tighter labor market. of course it's good to have more jobs and a tighter labor market. the fact that that could be accomplished with 2% economic what is very to disappointing namely the potential of the u.s. economy to grow is very low. most cbo and our committee estimates the economies longer potential -- longer run potential to grow is currently under 2%. chair, mytion madame if you had
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unfettered discretion and were averaging 2% growth and you wanted to get as close to 3% as which would be considered normal before 2008, if you had unfettered discretion what would you do? >> this is really not a job for the federal reserve. it's a job for congress. >> i'm asking for your advice. >> i advice would be to focus on all of those factors that determine productivity growth and that pertains to tax reform and the efficiency with which the economy operates. i would focus on training, education, the quality of human capital in the economy. i would focus on investment, both public and private.
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i would focus on policies that impact the pace of technological change and research and development and there are a wide range of policies that bear on everything in my list. that set of channels that i think is important in boosting the economy's potential to grow. >> did we make a mistake moving away from glass-steagall? don't believe that glass-steagall was responsible for the financial crisis. that as a major fore that was responsible the financial difficulties. >> did our move away from it contribute at all or was it just irrelevant in your judgment? the largest distress was
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suffered at standalone investment banks like bear stearns and lehman. that was a product of glass-steagall. the fact that those investment banks are now all major investment banks are part of bank holding companies and subject to stronger capital regulation is an important safeguard. >> has the volcker rule worked? designed to stop proprietary trading in banking organizations. it's a goal with which i agree. it was intended to permit market making. the implementation of it has been very complex and
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burdensome. we have suggested that community banks be exempt from it entirely. >> should we get rid of it? >> i wouldn't get rid of it. i believe the treasury report restrictionntaining on proprietary trading and depository institutions. i wouldn't get rid of it but i would look for ways to simplify it. >> last question quickly. reappointment?t >> it is something that i really don't have anything to say about at this time. on carryingocused out the responsibilities that congress has assigned to us. decided thatlly issue.
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>> thank you for your service, madam chair. >> thank you. we are approaching the stop time i hoped we would be able to meet. senator brown has asked for one more question. >> this wasn't my intent. would were reappointed i be happy to join senator kennedy in supporting your reappointment. >> thank you, senator. >> i'm very mindful of the therman's 11:30 meeting republican conference has and i'm grateful for his giving me this series of last questions. dodd-frank required to study forced arbitration and to make a role protecting consumers from the practice of doing so. in the public interest. it released a study of the impact of forced arbitration, agreements on consumers,
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arbitration and consumer contracts. during that time cfpb survey consulted with experts at prudential regulators like you. if any of your -- a couple of questions. if any of your staff had safety and soundness concerns about this rule do you think they would have raised those concerns with the cfpb during the rulemaking process? >> i know my staff consulted and i assume they would have. i'm not certain what those consultations were. if the rule were likely to impact the safety of the u.s. banking system do you think it would be unusual that no staff of any of the prudential regulators would raise concerns about the rulemaking process? >> i assume they might well have. that's why i thought it was unusual. i was surprised to see the acting controller understanding
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his short time and short horizon to stay there that he raised issues with this rule so late in the two-year long process and mentioned safety and soundness and think the director very clearly explained the efforts cfpb has made to consider input from safety and soundness regulators. >> without objection. if i had not you were going into the arbitration rule i would have rethought. will discuss it further probably. chair yellen, thank you for being with us today. for senators who wish to submit questions for the record thursday, july 20 is the due date.
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if you receive questions to please respond promptly. and with that this hearing is adjourned. >> federal reserve chair janet yellen finishing what could be her final testimony before congress, the second day of testimony. the chair of the federal reserve there telling the senate much the same as what she told the house financial services committee yesterday, a couple headlines that are live team has taken out of today's q&a is, for example, yellen expecting long-term market rates during that runoff period tapering. the fed will factor in the yield curve in setting the fed fund raise. we saw the long end of the current move upwards a little bit off that market. >> she said we're watching inflation very carefully, that is a continuation of the theme from yesterday.
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prudent toays it's remain on a gradual path. i was going to say just before the final question before senator brown and john kennedy was speaking. no senator asked whether she has hopes -- the final question of all was that question, does she expect to be real plan. she gave that standard answer, not something she can say about. vonnie: a lot of today talking about financial regulations. let's check in on how markets have been reacting to that testimony great bloomberg's julie hyman is here with the latest. julie: it's a much more muted reaction than we saw yesterday. we have not the strong rally we saw yesterday as yellen did not really break new ground in her testimony. one could argue she did not
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break new ground yesterday either but we saw more from market reaction. right now we have financials backing -- bouncing back. health care shares move, if indeed there's movement on health care legislation. right now all three major averages higher. the dow is at a record and that record is coinciding with another that we should point out. look at the bloomberg here, we're looking at the dow as well as the dow jones transportation average in white. if you're a subscriber to dow theory, when they come to simultaneous records that means perhaps we are in store for more gains. little stretch here since we last saw this kind of movement. one of the stocks in the dow trailing is walmart. the company account saying that sales would likely increase this quarter. it is revising, reversing that earlier forecast for decline. trying to turnn
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around fortunes at that retailer. we tail in general has been struggling, introducing two new products and moving prices lower. target shares 4% warmer, gaining little more than 1% rate as for the transport, the budget the best-performing stock in the dow transportation average. intelligence citing some information from auto rental news showing that airport rental rates at u.s. airports were higher last month. we have some of the airlines, except for delta, whose earnings came in below estimates. vonnie? vonnie: thank you. want to get straight to washington, d.c. kevin cirilli standing by with a ranking member of the banking and housing committee. >> thank you. we are with senator sherrod brown. what did you make of the hearing we just saw? >> she always performs directly, she speaks well, she's honest, she talks directly to people and
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people in both parties recognize and appreciate that. there's far too much amnesia on the senate banking committee and congress about what happened to the economy eight or nine years ago. while the administration, which from time to time looks too much like a consecutive retreat for goldman sachs, the administration is pushing as are some senate republicans for wholesale weakening of consumer protections and safety and soundness rules that now are in place. she's optimistic that we don't have a meltdown, economic disaster, or implosion and a problem with the banks in the next few years. deregulate, you don't weaken these wall street rules and that's what she emphasized. >> i'm wondering if based upon this hearing you got any impressions on what you think she thinks about the current situation, the current administration. whatdidn't get a feel on
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she thinks about the president assonally or what many see the incompetence of the treasury and throughout much of the white house getting people in place, making clear, concise rules. but i know she's concerned about efforts, as i mentioned, when i asked my question about the report put out by the treasury department that calls for lower capital standards and weaker rules. if we do that, we could may be more likely than not be back where we were a decade ago, and when people in cleveland, ohio lost homes and jobs. >> there's a lot of talk this might be the last time chair yellen testifies in her capacity before congress. what do you make of the idea that gary cohn could lead the federal reserve, and what do you make of who the who -- who you think the president should nominate? >> is not up to me to recommend. i would love to see the president re-recommend yanet jellen. though obama kept bernanke in
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place, i don't know this white house will do that. i'm concerned about wall street. this has become an administration of wall street, by wall street, and for wall street. i would hope the white house would go somewhere else than somewhere else in wall street for this job. this a more moderate version of the bill, is this something any democrats will be able to get on board with or is it a nonstarter? >> i don't know what it looks like but i stand with governor kasich. i'm a democrat in ohio, he's a republican with ohio. you give tax cuts to insurance and drug companies and to make up for that loss, make cuts to medicaid. right now we are getting opioid treatment, 200,000. we are getting that treatment because of the affordable care act. this would pull it away from them, so it's a nonstarter.
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45 billion as governor kasich said is a spitting in the ocean. something like 15% of the american public likes this bill and that is something mcconnell meets in a dead of night, puts the bill out, no hearings, quick vote, because he knows the more sunlight on this bill, the less the american public likes it. >> senator sherrod brown, the top democrat on the senate banking committee, thank you for coming by bloomberg. vonnie, back to you in new york. vonnie: kevin cirilli there with sherrod brown. we will have a look at how stocks finish up the day in europe. >> let's quickly rattle through this, the stoxx 600. highest close since june 26, yesterday of course post yellen it rose by 1.5%, the most in april 2014. 600 big decline or today, asked her zen most since last year, following a
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report in an israeli publication the chief executive hands -- pla ns to jump ship from the drugmaker to take the top job in israel's struggling teva marta circles industry -- pharmaceuticals company. how it's narrowed since before the french election when the yield spread was 80 basis points, the widest in 2012. we've come down to roughly 25 basis points. will expectations macron unveil structural reforms that with potential tapering of bond purchases by the european central bank around the corner, j.p. morgan chase says this spread may widen. keep an eye on that. one year anniversary, you know what. one year since theresa may became the u.k. prime minister. showing you how the main u.k. acid stared under theresa may.
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that's the ftse 100. the falling pound boosted exporters. sterling index down by 2.9%. that's the blue line. andy bloomberg sovereign bond index for the u.k. is down by 2.6%. the asset class to be in under may is very much stocks. the big question is, will she still be pm in a year. vonnie: it's crazy how fast a year goes by. i'm sure she's celebrating a bittersweet anniversary in some ways rate health care in focus this hour in the u.s., senate republicans meeting for the details of a revised health care bill. details of senator mitch mcconnell's revised will have been leaking out. a proposal by lindsey graham also making headlines straight in an interview, president --ald trump has said republican votes have to pull it
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off. becauseo begin with you we are getting competing health care bills from the senate that look very similar, in fact. i would keep an eye on the mcconnell updated version of the bill which is supposed to be going live on the bill at any moment now. my colleagues and i have gotten some details that have been leaked. compared to the previous version that came out a few weeks ago, that mcconnell had to pull, this one had to change notably the ted cruz amendment. know, it would allow insurance companies to sell catastrophic skinny policies on the exchange that they also sell insurance plans. that's a major step, a major change that they are uncomfortable with, including susan collins.
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decided to keep three obamacare taxes that were imposed on wealthy people, the initial drafter fielded in this one keeps it right that includes investment income tax. it also keeps an insurance compensation of ceo tax. these are key differences that includes $70 billion. it includes an additional $45 billion or opioid funding. the lindsey graham proposal is a plan b they have been talking about for a while. it essentially locks of the money for the ac exchanges. it turns it into a block grant. states can spend it however they want. -- thes the obamacare pre-existing condition protection of obamacare repeals the individual mandate. vonnie: how have senators been reacting?
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there's a lot to react to. do they go with lindsey graham? mitch mcconnell? >> or do they go with the governors? i spoke to the senator from tennessee, bob corker, as he was leaving the meeting with fed chair yellen. going toenator, do you be able to get on board with this ugly because the obamacare taxes are kept in the fed? said, they will address the tax issue when they get the tax reform. that really is the bigger picture take away from all of senators are being told, such as senator corker and senator ted cruz's of the world as well as the house of representatives, that you might not like this proposal being put forth by the majority leader, but we can get to your tax cut issues once we address tax reform, which of course is something that has been something that lawmakers really want to get to in terms of the republican party.
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there is some bargaining going on, let's get to health care than we can get tax reform. vonnie: not repealing those taxes will give republicans a next her $230 billion to play with or so. it's not savings exactly because those taxes are in place but they would be able to do something with this. we just got the cbo scoring of the 2018 budget as well which hopefully we will get time for. you'retion is, if putting money into stabilizing the exchanges and allowing for skimpy coverage, how does that work? isn't one coughing out the other? you talk30 billion about, the number is exactly right. that's what senator mcconnell has to play around to try to win moderate members. some of that is going into more opioid funding and $70 billion is going into more stability for the obama care exchanges, at least in the near term. your point about the ted cruz plan to offer skimpy plans,
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essentially it allows people to use their tax subsidies with the criteria which changed in this republican bill which allows them to use those for catastrophic plans. if young people are healthy, young people decide to buy those skimpy plans and they end up getting very sick and needing forly treatment or services a major illness like cancer or something like that, they will have to pay for that out-of-pocket because their plans won't cover them and you can suddenly switch in the middle of it. that is a cost. it does it cost more to ordinary americans who don't pick the right plan for themselves? >> how much pressure is on the republicans to simply repeal obamacare, and replace it later? >> a lot. i don't think we can quantify it. these folks campaign for more than 7 years that they would do something on health care and now they are heading into an august recess. the majority leader delayed by 2 weeks.
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i think what's interesting when we take a look at the politics of this is that we in washington look for the strange political bedfellows. the fact that senator ted cruz is working with the majority leader to craft a policy, and i you have the emergence of senator lindsey graham. -- graham, who has clashed repeatedly with ted cruz and that wind of the party consistently. in terms of these plans, i would raise the point that this health savings account, hsa's, as they are known, have been a popular policy prescription for the conservative wing of the party that was touted frequently during the lead up to the 2016 election by people like dr. ben carson, now secretary carson, as well as the host of others, including dr. rand paul, senator paul. this is very much in that wing of the process. they would argue that if you have a health savings account and you're going to be a first-time user of that, if you
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are a young person or someone with a pre-existing condition, that would incentivize you to get into the health care market. senator lindsey graham who wants to bolster power back to the states, send more power back to the states, that's much more in line with the thought process we heard consistently for several years. vonnie: i want to ask you a quick question. the cbo has come out and found the deficit in 10 years time under president obama 2018 budget and projections would be $720 billion. the administration would not be balancing the budget. trillion, savings from health care savings as well over the 10 years. what will be administration due to respond to this? this is including a massive overhaul in health care but it's not exactly what they promised in any way. >> i think you meant president trump, not obama. the fiscal 2018 budget will not
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balance over 10 years as president trump and his officials have suggested. they wanted to. as you mentioned, the deficit in year 10 is $720 billion away from balance. i don't know how the white house will go in response to this, if they will try to dismiss it. that remains to be seen. we will have to see whether it causes recalibration. president's budgets are opening bits. they never ultimately get passed by congress. they have been passing budgets over the last several years the do bounce over 10 years. so, it's extremely unlikely for that reason and many other reasons. much of trump's budget will not be taken up. and parcel of the
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fact that republican senators and members of the house are going to go there, go that way on the budget. probably have not as many radical changes. vonnie: this is not that conversation we have on that today. thank you both so much. >> if you've noticed some movement in sky shares just before the close here, and fox in the united states, rupert murdoch won't offer a deal to the u.k. to make sky news more independent. fast track's takeover of sky, according to "the guardian," without specifying where i got the information. fox will make a submission to the culture secretary criticizing the review process and conclusion. fox won't offer a remedy to strengthen the editorial independence to everett the deal being referred to the regulator. murdoch, of course, facing that tough decision over the last week or two, offered more concessions that will make his bid for sky $15 billion bid for
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slightly less attractive, or gambling he can get it through this peerless six-month regulatory review, culture secretary karen bradley already rejecting proposals from 21st century fox intended to safeguard the editorial independence. you saw what happened to shares of fox and sky in the last 20 minutes. vonnie: coming up, u.s. president donald trump and french president emmanuel macron said to hold a joint news conference last hour. we will go live in paris to the latest on macron's meeting. this is bloomberg. ♪
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vonnie: the two leaders have been holding a bilateral ahead of their joint news conference, due to start 30 minutes from now
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, which will be obviously live. our white house reporter is traveling with president trump, and he joins us now from paris. what would be the most important point for macron to get across to the president? it was on his invitation that the president went to paris the other day. >> that's right. there's a number of disagreements between the french and u.s. government. it seems like they want to talk about areas where they agree, areas of national security, fighting the islamic state militants in syria and trying to bring the u.s. and france together on a strategy for what happens after isis is defeated. there's a number of different groups that need to be quarter dated and a political solution needs to be found. that's one of the things they will talk about. they want to celebrate the 100 year anniversary of the u.s.
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entry into world war i and all that happened since in this partnership between the u.s. and france, fighting on a number of different war fronts and battlefields all over the world including most recently in iraq and syria and afghanistan. they will be talking about strategy and how to move forward and some of the areas where they have this agreement, areas like those areas will also be on the table. this provideoes president trump with some respect from the controversy surrounding donald trump jr.'s meeting with that russian lawyer? few hours, the a president has been on the ground in paris for half a day but he will have a press conference in the next hour or so and that will be dominated, at least from the u.s., by questions about this meeting the president's son had with what he believes was a
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russian government operative with political dirt on his political opponent. those are the questions the president will have to answer when he faces the press. any respect people get will be short-lived because all the news headlines will be focused on what the president has to say about what he knew about his son's meeting with this russian lawyer and what it means about all of these blanket analyses the trump administration put forward about never having contact with russians during the campaign. the airways was filled with the -- is this an recess between a the french president and the u.s. president given the last time and the first time they met , the focus was on that firm handshake, that white knuckle handshake. is there an expectation this is a real opportunity to reset, to relaunch this relationship?
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>> yes. for thean opportunity two leaders to talk about areas where they degree and not -- agree and not where they have that awkwardness, discussing several areas where they disagree. changed office campaign by saying parts of europe including paris have been taking over and were no longer what they used to be, a decline. he says paris is no longer the paris that he wants new. when he pulled out the paris climate agreement he said he was elected to represent -- and not paris. on areas of national security, counterterrorism, you heard both leaders say the u.s. and france are tacitly coordinating and they are together in their support for one another. the fact that they are focusing on those issues during this meeting means they can turn the corner from some of those disagreements and decide to have a much more fruitful relationship going forward. >> thanks a lot.
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reporting live from paris, vonnie. vonnie: it's official now, breaking news, senate republicans released an updated draft of the health care bill. some of the provisions of that additional $70 billion to help stabilize their exchanges, their markets, and offset the cost of covering extensive patients. there's also three wealthy taxes that will now not be repealed. that gives an additional $230 billion to republicans, a sweetener for some states where perhaps senators were not so hot on the bill. $45 billion to fight the opioid epidemic. the option for so-called skimpy plan as well. let's get into some more of the details of this just-released, updated republican bill. our quiche -- our chief
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washington correspondent, kevin cirilli. what are the compromises that are most egregious that weren't in the original plan? ,> just literally moments ago mitch mcconnell releasing this. i was taking a look at it just before coming on air. thebillion to stabilize insurance markets to the obamacare exchanges. that's an addition to the $112 billion already in the original version. that's a significant increase to try to stabilize exchanges at the state level, which they're hoping will be able to garner some conservative support. also it would keep in place the taxes from the affordable care act or obamacare. that has been a point of concern and contention for several conservative senators such as senator ted cruz of the world. he has been the conservative
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architect the hind the teams trying to negotiate a deal with the majority leaders. it's very unclear whether or not that will satisfy people like senator rob portman's of the world. these lawmakers meeting as we speak here in washington and the capital. in terms of more broadly speaking, we were talking for weeks about whether or not the majority leader would try to peel off census before democrats. take a look at this bill, no democrats will support that. vonnie: there's a question mark around whether rand paul will, likely not. i guess for now we haven't heard from him officially. if one other senator doesn't support it, is it dead? >> yes. that's why this gets really interesting. you make a great point. it simply is not therefore republicans to be able to lose two more votes. you have a situation now where
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by the top plan, senate majority leader her worked with the top ultraconservative ted cruz, but meanwhile you have republican governors, jeff and john kasich organizing, and you have senator lindsey graham, a republican muchsouth carolina, a very a critic of the ultraconservative wing in his own party. now you have essentially 3 different factions at the gubernatorial level, the moderate level, and the majority these level working on different plans. it's ambitious to think they can all get to some type of agreement by next week when the majority leader wants to bring this to a debate on the floor. right now it's very unclear. vonnie: we're not seeing too much reaction from health care stocks. that's really the only health care stock that is moving. at the same

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